With Corn ethanol more expensive than oil, is Jatropha the solution?
With Corn ethanol more costly than oil, is Jatropha a better biofuel?
August 24, 2007
Jatropha may be a more economic biofuel than corn-based ethanol, reported the The Wall Street Journal on Friday, citing research from Goldman Sachs.
Analysis of the bioenergy market suggests that jatropha, which can be grown in variable conditions with little water or fertilizer, could be used to produce a barrel of fuel for around $43, less than the cost of sugar cane-based ethanol ($45 per barrel) or corn-based ethanol ($83 per barrel) currently favored in the United States. Further, because jatropha isn’t edible and grows on land unsuitable for foods crops, its expansion doesn’t compete with traditional food production.
The Wall Street Journal reports that oil giant BP and other firms are investing in jatropha in Thailand, the Philippines, Swaziland, Saudi Arabia and especially India.
Chart showing relative costs, in terms of dollars per barrel of fuel, of biofuels derived from various bioenergy feedstocks. Data comes from Goldman Sachs via The Wall Street Journal. Graphic by Rhett A. Butler
“The enthusiasm for jatropha and its ilk highlights how quickly investors are shifting gears as the shortcomings of other renewable fuels become more apparent,” writes Patrick Barta. “It also illustrates the risks of newer approaches, since it’s still far from clear whether jatropha and its peers are economically viable on a large scale.”
Barta notes that projections for jatropha are based on limited experience with the plant as an energy crop.
“Even some of jatropha’s biggest advocates concede the plant’s oil output is unpredictable and often lower than expected. Although it can grow without water, it tends to do much better when water is added, raising its cost of production and mitigating some of the perceived benefits,” Barta writes.
World biodiesel and ethanol production, 1980-2003, based on data from the International Energy Agency (IEA). Graphic by Rhett A. Butler
“Some farmers have already reported financial losses from jatropha plantations after their crops yielded less oil than expected or buyers failed to pay sufficient prices. In a worst-case scenario, some rural-development experts fear, small Indian farmers could wind up serving as guinea pigs for an untested industry, leaving them in debt if the boom fizzles.”
CITATION: PATRICK BARTA (2007). Jatropha Plant Gains Steam In Global Race for Biofuels. The Wall Street Journal August 24, 2007; Page A1
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